China-ASEAN FTA and Korean FTA Policies

초록

The China-ASEAN FTA will significantly affect Korean economy. It is estimated to negatively affect Korean export by 1.4 billion dollars. Of more concern is however how Korea and Japan will react thereto. There are two theories: Domino effect theory and Spaghetti bowl theory. Three likely scenarios: Korea and Japan may try to form a competing group through Korea-Japan FTA; Korea and Japan may be pulled into the China-AEAN FTA; and the status quo. Three major factors to consider: Sino-Japanese rivalry, the issue of agriculture for Korea and Japan, and the negative attitude of US. Korea is called upon to more actively pursue FTAs with its major trading partners. It should also coordinate with ASEAN in mitigating the Sino-Japanese rivalry toward forming the East Asian integration under the umbrella of ASEAN plus Three.